Saudi's Falih says more oil output cuts possible, will assess in July

Oil falls on potential undermining of OPEC-led deal

Oil prices rose about 1% on Thursday after a larger than expected draw in U.S. inventories, providing some relief amid investor scepticism that Opec-led cuts will be enough to rebalance an oversupplied market.

The move pushed Brent crude prices up as much as 1 percent, before paring gains to trade down 30 cents at $49.65 a barrel at 1046 GMT (6:46 a.m. ET). He said his administration could try to renegotiate the existing agreement or try to create a new one that is more favorable to the U.S.

Brent oil tumbled below $50 on Friday, heading for a second straight week of losses, on worries that U.S. President Donald Trump's decision to abandon a climate pact could spark more crude drilling in the United States, worsening a global glut.

They dropped $1.34, or 2.7 percent, in the previous session to settle at $48.32 per barrel, the lowest close since May 12.

November's deal between OPEC and non-OPEC members like Russian Federation has been slow to take hold, as many nations sold inventory out of storage before truly cutting exports.

On its part, the US West Texas Intermediate crude futures fell 84 cents to $47.54 per barrel, figures from Reuters show.

He said the nation's oil production was still hovering around 1.5 million barrels per day, down from around 2.2 million b/d.

But U.S. production is not growing as fast as the government earlier predicted.

USA crude production last week was up by almost 500 Mbbl/d from year-earlier levels, straining OPEC's efforts to reduce global oversupply.

While there was a dip in OPEC supplies between February and April, a report on Monday by Thomson Reuters Oil Research said OPEC shipments likely jumped to 25.18 million bpd in May, up over 1 million bpd from April.

Hedge funds trimmed bets on rising crude prices to the lowest level since November as oil futures dipped below $50 a barrel amid skepticism an OPEC-led campaign to cut output will soon curb a worldwide supply glut.

In Libya, the state oil firm said output had reached 827,000 bpd on Wednesday, around levels last seen in 2014.

"As these numbers are getting confirmed, the initial optimism about OPEC's temporary cuts, may turn to increasing skepticism about OPEC's choice of policy once the current output deal expires next year", says Bjørnar Tonhaugen, VP Oil Markets at Rystad Energy.

The Organization of the Petroleum Exporting Countries extended a 2016 agreement which calls on most of its members and several non-members to collectively lower their oil output to help support oil prices.

Both Moscow and Riyadh said cooperation would continue beyond the current agreement as both countries were still trying to find ways to co-exist with USA shale oil producers, which are not part of the global output reduction deal.


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